Chatham Asset High Yield Master Fund, Ltd. managed by Chatham Asset Management entered into a non-binding letter of intent to acquire remaining 85% stake in R. R. Donnelley & Sons Company (NYSE:RRD) for approximately $530 million on October 12, 2021. Chatham Asset High Yield Master Fund, Ltd. managed by Chatham Asset Management entered into a definitive merger agreement to acquire of remaining 85% stake in R. R. Donnelley & Sons Company (NYSE:RRD) for $1 billion on December 14, 2021. As per the article of October 12, 2021, consideration is at a price of $7.5 per share representing a 52.1% premium over yesterday's closing price of $4.93 per share, a 6.2% premium over the 52-week high of $7.06 per share, and a 92% premium over the 365-day volume weighted average price of $3.91 per share. As of November 16, 2021, Chatham Asset revised its offer to acquire R. R. Donnelley & Sons Company (RRD) for $640 million in $9.10 per share. Additionally, Chatham announced that If the termination fee and expense reimbursement payable under the Agreement and Plan of Merger executed on November 3, 2021 ("Atlas Merger Agreement"), between RRD and affiliates of Atlas Holdings LLC ("Atlas") is eliminated, Chatham will increase its offer to $9.34 per share. To facilitate the transaction, the reporting persons also propose to equitize and/or subordinate $575 million in face amount of debt reporting persons own and to provide up to $250 million in new money equity and/or subordinated capital. Chatham would be able to fully fund the transaction using cash on hand and external financing, such that the transaction would not be contingent on obtaining financing and has secured a highly confident letter from Jefferies Group LLC supporting its ability to raise all necessary funds. As a further demonstration of its commitment to ensure a successful financing Chatham has increased its ownership of R.R. Donnelley & Sons outstanding debt by approximately $78.8 million, to an aggregate of approximately $654.4 million, all of which it plans to equitize and/or subordinate in connection with its proposal. As of November 16, 2021, Chatham has received a debt commitment letter led by Jefferies Finance LLC in an aggregate amount of up to $1.675 billion. Post completion of the acquisition, the separate existence of Chatham Acquisition Sub shall cease, and the Company shall continue under the name “R. R. Donnelley & Sons Company” as the surviving corporation and RRD's shares will no longer trade on The New York Stock Exchange and RRD will become a private company. Total leverage of Chatham would decrease by approximately 0.9x, from 3.9x, to 3.0x, for the four quarters ended June 30, 2021, and that total debt would decrease by approximately $360 million, or 23%, as of June 30, 2021. As on November 2, 2021, given Chatham's current debt position, the transaction as contemplated would result in over a full turn of deleveraging, from 3.9x to 2.8x, equaling total debt reduction of 28%, versus 23% at the time of the last letter, and annual interest savings of 38%, versus 33% at the time of the last letter. As a result, we estimate that annual interest expense would decline by approximately $36 million, or 33%, for the four quarters ended June 30, 2021.

As of November 29, 2021, Chatham Asset revised its offer to acquire R. R. Donnelley & Sons Company for approximately $870 million in $10.25 per share. The Board of Directors of R. R. Donnelley & Sons Company will carefully review and consider the revised Chatham proposal to determine the course of action. The shareholders of R. R. Donnelley & Sons Company do not need to take any action at this time and the Board has not yet made any determination with respect to the revised Chatham proposal.

The transaction is subject to customary closing conditions, including approval by RRD stockholders, receipt of regulatory approvals, receipt of Board approval and R. R. Donnelley & Sons rights agreement, as amended to date, receipt of any required governmental and third party approvals including the expiration or termination of all applicable waiting periods under Hart-Scott-Rodino, to the extent required, and any required consents under material contracts and leases, confirmatory due diligence and negotiation and execution of definitive agreements providing for proposed transaction, which agreement would provide for customary breakup fees and a “fiduciary out” provision, as well as other customary representations, warranties, covenants and conditions. RRD Board of Directors unanimously determined that an unsolicited proposal from Chatham constitutes a Superior Proposal. The transaction is not subject to a financing condition. As of December 1, 2021, R. R. Donnelley & Sons Company announced that Board of Directors unanimously determined that an unsolicited proposal from Chatham Asset Management, LLC to acquire all of the common stock of the Company not already owned by Chatham and its affiliates for $10.25 per share in cash constitutes a “Superior Proposal” as defined in the Company's previously announced definitive merger agreement with affiliates of Atlas Holdings LLC, dated as of November 3, 2021. Under the terms of the Atlas Merger Agreement, affiliates of Atlas have agreed to acquire the Company for $8.52 per share in cash. As of December 10, 2021, Chatham Asset Management offered to purchase all common stock of RRD not already owned by Chatham at a price equal to $10.85 per share. As of December 10, 2021, RRD Board of Directors unanimously determined that an unsolicited proposal from Chatham Asset Management to acquire all of the common stock of the Company not already owned by Chatham and its affiliates for $10.85 per share in cash (the “Revised Chatham Proposal”) constitutes a “Superior Proposal” as defined in the Company's previously announced definitive merger agreement with affiliates of Atlas Holdings LLC, subject to the condition that Chatham agree to extend the Revised Chatham Proposal until December 17, 2021 (the “Timing Condition”). If Chatham refuses to agree to the Timing Condition, the Board will deem the Revised Chatham Proposal as withdrawn and incapable of being accepted by the Company. As of February 18, 2022, regulatory approvals for the transaction have been obtained, and, subject to the stockholder vote scheduled for February 23, 2022, the transaction is expected to close as soon as February 25, 2022. As of February 23, 2022, the transaction was approved by RRD's shareholder. The applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, has expired. The transaction is expected to close in the first half of 2022. As of February 2, 2022, the transaction is expected to close in the first quarter of 2022.

Jefferies LLC served as a financial advisor, and Steve Wolosky and Elizabeth Gonzalez-Sussman of Olshan Frome Wolosky LLP and James O'Grady and Robert Bee of Lowenstein Sandler LLP served as a legal advisor, for Chatham Asset Management. Centerview Partners LLC served as a financial advisor and as a fairness opinion provider and Shilpi Gupta and David Clark of Skadden, Arps, Slate, Meagher & Flom LLP served as a legal advisor for R. R. Donnelley & Sons Company. Macquarie Capital is serving as financial advisor and Willkie Farr & Gallagher LLP is serving as legal advisor to Atlas. Innisfree M&A Inc. acted as an information agent to RRD. Innisfree will receive an estimated fee not to exceed $175,000. RRD has agreed to pay Centerview an aggregate fee of approximately $27,400,000, $4,000,000 of which was payable in connection with the rendering of Centerview's opinions, and the remainder of which is payable contingent upon consummation of the Transaction. Computershare Trust Company acted as a transfer agent to RRD.

Chatham Asset High Yield Master Fund, Ltd. managed by Chatham Asset Management completed the acquisition of remaining 85% stake in R. R. Donnelley & Sons Company (NYSE:RRD) on February 25, 2022. Upon completion of the transaction, RRD's shares will no longer trade on the New York Stock Exchange and RRD will become a private company. In connection with the completion of the transaction, Thomas J. Quinlan, III has assumed the role of President and Chief Executive Officer of RRD and Daniel L. Knotts ceased to serve as President and Chief Executive Officer. All of the members of the board of directors of RRD immediately prior to the close of the transaction, ceased to be directors of RRD. Thomas J. Quinlan, III, Eugene A. Castagna, Edward P. Taibi, Jeffrey K. Dorsey, R. Elaine Lintecum, Evan Ratner and Roshan M. Karingada were appointed as the directors of RRD.